In the latest fine against banks for systems and controls failings in anti-money laundering (AML) procedures, FCA has fined Standard Bank PLC £7,640,400. The failings related to the bank's commercial banking activity and in particular its failure to take reasonable care to apply its policies appropriately and consistently to customers connected to Politically Exposed Persons (PEPs). FCA found the bank did not consistently carry out an appropriate level of Enhanced Due Diligence (EDD) on these customers, nor carry out an appropriate level of ongoing monitoring. FCA considered these failings resulted in an unacceptable risk of money laundering because the bank:
- provided loans and other services to many customers from high-risk jurisdictions;
- identified problems with its ongoing review process but did not resolve them; and
- did not heed previous actions by FCA.
This fine, a civil penalty for failure to comply with the Money Laundering Regulations 2007, was the first AML fine decided under the new penalty regime, and the fine would have been nearly £11 million had the bank not settled at an early stage. FCA also noted the significant steps management had taken to remediate the problems. (Source: FCA Fines Standard Bank for AML Control Failings)
FCA updates financial crime webpages: FCA has updated its website to create new information pages on financial crime. There are separate pages covering:
- data security;
- anti-bribery and corruption;
- anti-money laundering;
- consumer credit; and
- the obligation to report suspicious transactions.
FCA has published further guidance reminding firms of the different requirements to report suspicious transactions where they relate (a) to money laundering or (b) to suspected market abuse. (Source: FCA Updates Financial Crime Webpages and FCA Updates on Reporting Suspicious Transactions)
FCA publishes unfair terms undertaking: FCA has published a Notice of Undertaking under the Unfair Terms in Consumer Contracts Regulations 1999 in relation to Kensington Mortgage Company Limited. FCA felt several terms in the firm's mortgage conditions booklet gave the firm excessive discretion which, if exercised, may at times have been unfair. The firm had not used the conditions for some years and has agreed to treat all customers as if its newer, fairer, terms applied to them. (Source: FCA Publishes Unfair Terms Undertaking)
FCA bans senior executive on fitness grounds: FCA has confirmed the ban on Mr Anthony Verrier after he withdrew his reference to the Upper Tribunal of the Decision Notice published in March 2012. The Court of Appeal had found Mr Verrier had participated in an "unlawful means conspiracy" when he induced brokers to breach their contracts of employment with Tullett Prebon. For this reason, FCA has confirmed its decision to use the power under section 56 of the Financial Services and Markets Act to make a prohibition order where it appears to it that an individual is not a fit and proper person to perform functions in relation to a regulated activity. (Source: Final Notice Anthony Verrier)